“A robust manufacturing base post-Brexit is vital for the UK economy, workers and local communities.”

The UK’s largest carmaker, Jaguar Land Rover, has yet to make a commitment to building its next-generation electric cars in the UK after it demanded the government agree to fund £450m of infrastructure in the West Midlands before it made a decision.

In April the company, owned by India’s Tata Group, said it would cut more than 1,000 jobs, blaming a slump in car sales due to uncertainty about Brexit and the future of diesel vehicles.

UK manufacturing shows signs of a slowdown

Read more

In 2016, Tata made more than 1,000 workers redundant across its steel plants in Port Talbot and Llanwern in south Wales and in Trostre, Corby and Hartlepool. Last week, it urged the government and the European Union to fight sanctions imposed by Donald Trump’s Republican administration, which it said would harm steel exports.

The EEF, which represents manufacturers, said the continued political uncertainty over Brexit negotiations had dragged down business investment to the lowest level for a year.

A poll of more than 300 manufacturers found they remained generally positive, with business confidence holding up looking forward to the second half of the year.

“However, the durability of this upturn is looking somewhat more fragile as many of the positive forces driving expansion last year such as a resurgent eurozone, a surge in global manufacturing investment and competitive pound are starting to fade,” said the organisation’s chief economist, Lee Hopley.

“New or heightened uncertainties have come into play, not least what feels like crunch time in the Brexit negotiations which have led to amber lights flashing again on the business investment outlook.”

The manufacturing sector has failed to regain the level of output seen before the financial crash in 2008. In the recession that followed, hundreds of companies went bust or moved production overseas.

Low oil prices and slump in the value of sterling helped manufacturers to increase exports during 2016 and 2017, but firms recorded weaker growth in the first quarter of the year as the stuttering Brexit talks increased uncertainty and a rise oil prices coupled with a higher pound increased import costs.

Tom Lawton, of the business advisory firm BDO, which helped with the research, said companies were still cautiously optimistic, but “we are starting to see the impacts of the ongoing political and economic uncertainty on the UK manufacturing sector”.

The GMB said London, Scotland and the north-west lost 27%, 22% and 21% of their manufacturing jobs respectively. The worst-affected region by total losses – the north-west – lost 93,500 jobs.